The Research Of How Corporate Social Responsibility Information Disclosure Affects The Cost Of Equity Financing

Since the global financial crisis in 2008,the concept of corporate social responsibility has been aroused its importance among the every aspect of society,most listed enterprises in china began to release corporate social responsibility reports.The improvement of corporate social responsibility information disclosure quality,is not only beneficial to reduce the external information users and the company’s internal actual controllers of asymmetric information,as well as to set up the good enterprise image,bring a lot of invisible benefits,such as corporate equity financing cost.Taking the data from 2011 to 2013 where companies listed in Shanghai Stock Exchange as example,this paper put emphasis on the studying of how two targets influence the cost of equity financing,one is corporate social responsibility information disclosure,another is corporate social responsibility information disclosure persistent.At the first,this paper gives a review of related research results provided by previous scholars,next,the relevant theories of corporate social responsibility and the model of cost of equity have been introduced.After that,we put forward two hypotheses based on the previous research,hypothesis 1 is that while other conditions remain unchanged,there is a negative correlation between the the information disclosure of corporate social responsibility and the cost of equity financing,anther one is that the persistent of corporate social responsibility information disclosure has a negative correlation with equity financing cost,and then through the empirical analysis to prove two hypothesis.In the process of sample data,the paper also compiled the current existing problems in the corporate social responsibility,and the empirical results were listed in the results of the study and put forward the corresponding policy suggestions.The conclusion of research is as follows:(1)A negative correlation between the information disclosure of corporate social responsibility and the cost of equity financing could be seen.Based on the data from 2011 to 2013 from companies listed in Shanghai Stock Exchange.We found that in the case of other conditions remain unchanged,the higher scores CSR reports get,the lower cost of equity financing will be.(2)There is an uncertain relationship between the persistent of corporate social responsibility information disclosure and equity financing cost.Being different from hypothesis above,there is not a significant negative relationship between equity financing cost and corporate social responsibility report sustainability.It may be that the enterprises continuous release social responsibility report the number of short,mostly within 10 years that leading to the result.According to conclusions above.The paper put forward some suggestions to perfect the corporate social responsibility,including:advocating corporate social responsibility report released by more enterprises,promoting sustainable corporate social responsibility,standardize corporate social responsibility information report content and form and put corporate social responsibility into practice.